Municipals close somewhat softer as Treasuries end mixed; Massachusetts sells green G.O. bonds

By Sheri Kasprzak

New York, Sept. 18 – Municipals were mostly unchanged on the day Thursday, market insiders said. Munis were seeking direction throughout the day, said a trader, but some weakness in 10-year Treasuries forced muni yields in that range up slightly.

The 10-year muni note yield climbed by about a basis point on the session. Meanwhile, the 10-year Treasury note yield climbed by 1 bp to 2.63%.

Secondary action was reportedly light with about $4 billion of transactions reported as of around 3 p.m. ET.

Massachusetts sells debt

Heading up the day’s pricing action, Massachusetts sold $350 million of series 2014E consolidated loan green general obligation bonds.

The bonds were sold through senior managers Morgan Stanley & Co. LLC, BofA Merrill Lynch, Citigroup Global Markets Inc. and J.P. Morgan Securities LLC.

The serial bonds are due 2019 to 2031 with coupons from 2% to 5%, said a pricing sheet.

Proceeds will be used to finance approved capital projects within the commonwealth.

NYC water brings bonds

Elsewhere during the session, the New York City Municipal Water Finance Authority hit the market with $300 million of series 2015DD second general resolution revenue bonds.

The bonds were sold through senior managers Rice Financial Products Co., Barclays, Citigroup, Ramirez & Co. Inc. and Raymond James/Morgan Keegan.

The bonds are due 2028 to 2029 with a term bond due in 2036, said a pricing sheet. The serial coupons range from 3.25% to 5% with 2.91% to 3.34% yields. The 2036 bonds have a 4% coupon that priced at 102.262 to yield 3.72%, a 5% coupon that priced at 113.682 to yield 3.34% and a 5% coupon that priced at 112.796 to yield 3.44%.

In secondary action Thursday, the 3.25% 2028s were seen trading between 3.13% and 3.363%. At the end of the day, the bonds were at 3.13%. The bonds initially priced at 3.34%.

Proceeds will be used to finance capital improvements to water infrastructure projects.

Guam Power deal prices

Also, the Guam Power Authority sold $76.47 million of series 2014A revenue bonds.

The bonds (Baa3/BBB/BBB-) were sold through senior managers Barclays and Citigroup.

The bonds are due 2017 to 2034 with term bonds due in 2039 and 2044, according to a pricing sheet. The serial bonds have 5% coupons with 1.29% to 3.64% yields. The 2039 bonds have a 5% coupon and priced at 110.17 to yield 3.77%. The 2044 bonds have a 4% coupon that priced at 98.964 to yield 4.06% and a 5% coupon that priced at 109.472 to yield 3.85%.

In secondary, the 5% 2044s were seen trading between 3.462% and 3.85%. At the end of the day, the bonds were at 3.462%.

Proceeds will be used to finance power capital projects for the authority.

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